Fed's Goolsbee Sees Encouraging and Concerning Parts of the CPI Report
•February 13, 2026
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Companies Mentioned
Why It Matters
The data underscores persistent price pressure in services, limiting the Federal Reserve’s ability to cut rates aggressively and shaping near‑term monetary policy decisions.
Key Takeaways
- •CPI cooled slightly, headline up 0.2% MoM.
- •Services inflation remains high, near 3% annual.
- •Real weekly earnings turned positive, +0.5%.
- •30‑year Treasury yields fell to 4.70%.
- •Goolsbee says inflation not on 2% path yet.
Pulse Analysis
The latest consumer price index report offers a nuanced view of inflation dynamics in the United States. Headline CPI rose just 0.2% month‑over‑month, keeping the annual rate at 2.5%, while core inflation held steady at the same level. However, the services sector continues to generate upward pressure, with inflation hovering near 3%—a figure that keeps the Fed’s 2% target out of reach. Analysts also note a modest improvement in real weekly earnings, which flipped to a +0.5% gain, providing a small cushion for consumer spending.
Financial markets reacted to the mixed data with a cautious dovish tilt. The dollar weakened as investors priced in a higher probability of future rate cuts, while long‑term Treasury yields retreated, with the 30‑year benchmark sliding to 4.70% from 4.90% earlier in the week. The bond market’s response reflects lingering uncertainty about the trajectory of services inflation and the Fed’s willingness to maintain a restrictive stance. Traders are closely watching upcoming economic releases, including the PCE report, to gauge whether inflationary pressures are truly abating.
For policymakers, Goolsbee’s comments signal that while some headline metrics look encouraging, the underlying inflationary environment remains sticky, especially in services. This persistence limits the Federal Reserve’s room to maneuver and suggests that any rate reductions will be incremental and data‑dependent. Consumers, meanwhile, may find short‑term resilience if the labor market stays solid, but sustained high services costs could erode purchasing power, keeping the broader economic outlook cautiously balanced.
Fed's Goolsbee sees encouraging and concerning parts of the CPI report
Chicago Fed President Austan Goolsbee’s Comments on the Latest CPI and Economic Outlook
Chicago Fed President Austan Goolsbee spoke with Yahoo Finance today and had some notable comments:
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Encouraging and concerning parts in latest CPI
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We are still seeing pretty high services inflation
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Hopes we've seen the peak impact of tariffs
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The job market has been steady, only modest cooling
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Rates can still go down but need to see progress on inflation
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Consumers should hold up if the jobs market is stable and inflation eases
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I don't know how restrictive Fed policy is
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High services inflation is worrisome
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We are not on a path back to 2% inflation, stuck around 3%
December CPI came in slightly cooler than expected, with headline inflation rising 0.2% month‑over‑month versus the 0.3% consensus, while the year‑over‑year rate held at 2.5%. Core inflation matched expectations at 2.5% annually and 0.3% monthly. Real weekly earnings flipped positive at +0.5%, a notable improvement from the prior revised -0.5%. Supercore printed at 2.7% year‑over‑year. Markets reacted with a modest dovish repricing of Fed expectations, pressuring the dollar lower.
Bond Market Update
In the bond market, the notable move this week has been in the long end, following a surprisingly strong auction and the turmoil in equities. Thirty‑year yields have slid to 4.70% from 4.90% this week.
US 30‑year yields, daily
Economic Calendar
The US economic calendar was busy this week but quiets considerably next week, in part due to the President’s Day holiday on Monday.
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Tuesday: Empire Fed and NAHB housing market index
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Wednesday: Durable goods and housing starts
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Thursday: Initial jobless claims (as usual)
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Friday: PCE report
There is a smattering of Fedspeak throughout the week, but it’s tough to imagine that any of it will make any real waves given the data dependence that most policymakers are preaching.
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